Parliament

Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 

Mates’ rates for Aussie insurers will cost Kiwis

Hon Maryan Street
Minister for ACC


2 July 2008 Media Statement

Mates’ rates for Aussie insurers will cost Kiwis

Australian insurance company investors are being advised they would reap large profits if the ACC scheme was privatised, but it would come at significant cost to New Zealanders, says ACC Minister Maryan Street.

“The confidential Merrill Lynch briefing to Australian investors, made public today, says National has given insurers a strong message it would privatise the $10.3 billion public asset if ever elected - although the party consistently refuses to provide any policy details to the New Zealand public.

“The briefing says privatisation of ACC could be a “very positive development” for Australian insurers which should be able to “capture” what will become the New Zealand injury insurance market.

“Putting the world-respected ACC scheme up for sale will rob all New Zealanders of the security they have enjoyed in the event of accidents, wherever and however they occur, for several decades,” Maryan Street said.

“Once National has traded away the protection the current state monopoly offers, accident compensation will become a lottery.

“For a start, levies will skyrocket. The Merrill Lynch briefing notes that Australians pay significantly more for injury protection per person than New Zealanders and that they get less cover for the price.

This mirrors independent research by PriceWaterhouseCoopers released earlier this year which showed the same companies Merrill Lynch expects to take over the New Zealand market, charge Australian employers 250 per cent more in levies as a proportion of wages, Maryan Street said.

“That report found ACC employer contributions were 0.78 per cent of wages, compared to an Australian average of two per cent. It found ACC motor vehicle levies were also significantly lower.

“Perhaps most worryingly, the report found that without ACC - and under a scenario similar to that in Canada, the US and Australia – roughly 70 per cent of current ACC clients would only receive benefits through social security and the public health system, a significant erosion of the support they now get.

“Under that scenario, individuals would be forced to take out private insurance in the event they fall off a ladder or injure themselves in a rugby game - and be left without accident compensation if they don’t,” Maryan Street said.

“They may have to pay to battle for their rights in court as do injured people in a number of other countries, including Australia – and if they do win the evidence is that insurers will pay less compensation and invest less in rehabilitation.

“The National Party sold off the railways and we have had to buy it back. Selling off ACC is so much more serious, because it’s playing with people’s health and wellbeing – and that of their families. New Zealanders make 5000 ACC claims a day. Are we really prepared to put that in the hands of Australian companies whose only driver is profit?

“What makes this a particuarly ugly underarm bowl by National leader John Key is that his Merrill Lynch mates and the Australian insurance companies know about his plans and the New Zealand public doesn’t,” said Maryan Street.”

--

Other findings in the PriceWaterhouseCoopers report.

• “The ACC under its current government monopoly structure performs as well or better than most other structures” worldwide, is often considered to be “best practice” and provides broader coverage than any other scheme in the world.

• The best mechanism for delivering the employers and motor vehicle accounts in New Zealand is the current government monopoly.

• ACC clients return to work faster than their Australian counterparts and ACC has lower claim management and administration rates.

• In the US, UK and several Australian states the use of lump sum payments, instead of the weekly compensation paid by ACC, generally disadvantages clients . Lump sum payments are typically used by private insurers and often fail to cover the needs of people with long-term or serious injuries in particular.

• Research shows private insurers are often less concerned about the vocational rehabilitation of injured clients – and that a significant group of people can miss out on injury cover altogether under privatised schemes.

© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The RWC, And The Op Burnham Inquiry

Testimony was given that damning evidence had been culpably ignored, lost or (deliberately?) mislaid. The systems for handling secret material from our allies were – to be charitable – only loosely observed.

Moreover… vital evidence was only belatedly made available to the inquiry, and former NZDF officers later found to be central to the events under scrutiny were strangely missing from the original witness list offered by NZDF. In short, last week’s cross-examination of the military’s former top brass demonstrated in detail that the NZDF had consistently misled its Ministers (and the wider public) for years, over the impact of our military activities in Afghanistan. More>>

 
 

Call For Action On Expert Panel Report: Welfare System Needs Urgent Change

If we want New Zealand to be the best place in the world to be a child, the Government needs to increase benefits, remove sanctions, individualise benefits, and fix abatement rates now, says Child Poverty Action Group and ActionStation . More>>

ALSO:

First Data Releases: Mixed External Report On Census Fail Mitigation

The panel endorses the statistical approaches used to mitigate non-response... However, the unprecedented use of alternative government datasets to augment census data raises questions around ethics, social licence, cultural licence, and Māori data sovereignty. More>>

ALSO:

Aitches: Manawatū-Whanganui Region Spelling Corrected

The Manawatu-Wanganui Region will in future be correctly spelt Manawatū-Whanganui Region. The change also means the regional council will be known as the Manawatū-Whanganui Regional Council. Horizons Regional Council is the trading name for the council. More>>

PM In Japan: Jacinda Ardern’s Remarks Following Abe Summit

Today we discussed a wide range of topics. Broadly the themes were: a deeper, high-value trade and investment relationship, greater cooperation in the Pacific; and strengthening our security partnership. More>>

ALSO:

Replacing All But Chair: Twyford Appoints Five NZTA Board Members

Transport Minister Phil Twyford today announced the appointment of five new members to the NZ Transport Agency Board... There remain two vacancies on the NZTA Board which will be filled in due course. More>>

ALSO:

Climate Change: Adaptation And Risk Assessment Framework Released

“We are already experiencing the effects of a changing climate such as coastal inundation and increasingly frequent and severe droughts, floods, fires and storms. This framework is an acknowledgement that we must start adapting”, James Shaw said today. More>>

ALSO:

Ihumātao: Mana Whenua Reach Decision On Land

Māori King Tūheitia says mana whenua have finally reached consensus over what to do with Ihumātao - they want it back. More>>

ALSO:

PM To Japan, New York: Ardern To Meet Trump During UN Trip

“I’m looking forward to discussing a wide range of international and regional issues with President Trump, including our cooperation in the Pacific and the trade relationship between our countries." More>>

 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

InfoPages News Channels